Indocement expects 5-6% sales rise

PT Indocement Tunggal Prakarsa Tbk, part of the HeidelbergCement Group, said sales would rise 5-6 per cent this year on hopes of strong demand from the infrastructure sector, Kontan reported, quoting the company's corporate secretary, Sahat Siahaan.

The country's second-largest cemen producer expects to boost production capacity to 24.9Mta by the end of this year, from last year's 20.5Mta as production starts at its 14th factory at its sizeable Tuban works. A recent visit by UBS to ascertain construction progress at the brownfield site revealed that despite a minor delay, the 4.4Mta line is likely to be completed and operational by year-end 2015, as expected.

Following the Indonesian government's recent instruction for state-owned cement companies to reduce their prices, Indocement has also decided to cut its average price from around IDR72000/bag (US$5.8) to IDR69,000. The move is expected to help offset SOE selling prices and boost sales.